TMI Blog2008 (11) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... y the appellants challenging a common order dated 12 th December 2005 passed by the Appellate Tribunal for Foreign Exchange, New Delhi (Tribunal) in Appeal Nos. 76 and 77 of 2005, rejecting the applications made by the Appellants for waiver of the pre-deposit of penalty as a condition for hearing the appeals. 2. Proceedings were initiated against both Appellants by the Respondent Directorate of Enforcement under Section 51 of the Foreign Exchange Regulation Act, 1973 ("FERA") for violation of Section 8(1) thereof. The case of the Respondent against Appellant Shri Nemi Chand Jain @ Shri Chandraswamy and Appellant Shri Vikram Singh was that a sum of US $ 1,49,000 had been withdrawn by them from the non-resident external (NRE) account in Canara Bank R.K.Puram, New Delhi of one Shri Akbar Jaffar Ali Veerjee ("Veerjee") a resident of Leichtenstein who stayed in India between 1 st and 3 rd July 1992. Veerjee had initially deposited a sum of US $ 500 (equivalent to Rs.14,850) at the time of opening the account. Thereafter on 4 th July 1992 a sum of US $ 10,000 (equivalent to Rs.2,95,000) came deposited in the account followed by US $ 1,39,000 (equivalent to Rs.42,29,756) by Foreign ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw the amount at any time he wanted. As regards the second deposit of $ 10,000/-, this was done in cash on 04.07.1992 by some one other than Sh. Akbar Veerjee because he had left India on 03.07.92 as per copy of his passport provided alongwith his reply to the department's directive. 37. As regards to the third deposit of US $ 1,39,000/- in the said NRE A/c of Sh. Akbar Veerjee, it is clear that the third and final deposit in the account was received by the bank in the form of an Foreign Inward Telegraphic Transfer, which along with the earlier deposits in cash works out to a total deposit of US $ 1,49,500/- into the account during a short span of period from 1 st July to 17 th July, 1992 and a major part of its equivalent amount in Indian Rupees to the extent of Rs.45,00,000/- was shared by S/Sh. Prakash Yadav, Vikram Singh and Chandraswamy (through his Ashram). The balance amount of Rs.43,251/- including interest but excluding bank charges, taken over by the department, is also a part of the above foreign exchange." 5. In conclusion the following order was passed by the Deputy Director: "I hold S/Shri Chandraswamy (Shri Nemi Chand Jain) and Vikram Singh, noticee no.1 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vests in the Trustees or in the governing body. The existence of trustees is not brought forth. Thus the appellants has not brought out any contrary facts to displace this position when such facts are in their exclusive knowledge. Under these circumstances an adverse inference is the logical result. It has prima facie been found that affairs of the Trust are managed by Chandraswami. It is contended by the Respondent that Chandraswami is solely managing the affairs of Vishwadharma Trust, hence all the benefits of Trust flow to this appellant. The appellant, Vikram Singh in whose favour a gift of Rs.5,00,000/- has been made has also not been able to prove his financial difficulty. Looking towards the situation, we direct both appellants to pre-deposit full amount of penalty within 45 days from today failing which the appeal will be dismissed on this ground alone." 7. The Appellants then filed W.P. No. 5613 of 2006 and W.P. No. 5618 of 2006 in this Court challenging the aforementioned order of the Tribunal. By separate but identical orders dated 24 th April 2006 the learned Single Judge has dismissed the writ petitions for the following reasons: "In order to be eligible fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avit dated 23 rd November 2005 filed by each of the Appellants enclosing the respective copies of their income tax returns which showed their income to be "nil". As far as Shri Chandraswamy was concerned in certain other appeals filed by him in 1996, the Tribunal had granted him exemption from making any pre-deposit and since there was no change in his status since then, the same order ought to have been passed in the present case as well. Mr.Lekhi added that as a sanyasi Shri Chandraswamy had already suffered a "civil death" and had no resources whatsoever to be able to make the pre-deposit as ordered by the Tribunal. 10. Mr.Vali for the Respondent drew our attention to the specific findings in the adjudication order of the Deputy Director and submitted that no prima facie case from grant of any exemption had been made out. He referred to the decision of the Supreme Court in Monotosh Saha v. Special Director, Enforcement Directorate 2008 (11) SCALE 603 and an order dated 22 nd July 2005 in S.L.P. No. 12728 of 2005 (Rajiv Narendra Khanna v. Union of India) and submitted that no case of genuine financial hardship had been made out by either appellant. 11. Having considered t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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